In NSW, a defendant has 28 calendar days from being served with a statement of claim to file a defence. If a defendant fails to file their defence within these 28 days, the plaintiff has the option to apply for default judgment.
What is default judgment?
Default judgment is an order made by the court determining the matter in favour of the plaintiff without having a hearing in court. A default judgment can be enforced in the same way a regular judgment can be.
A default judgment may be entered, and the plaintiff may begin enforcement processes, without your knowledge of the judgment. This is why it is crucial that if you have received a statement of claim, you communicate with the plaintiff about resolving the claim or seek further time to file your defence if needed.
When can you apply for default judgment?
If you have started a claim in NSW, you can apply to the court for default judgment after 28 days have passed from the date the defendant was served with the claim. You can only apply for default judgment if the defendant has been properly served with the claim, has not filed a defence, and has not paid you the full debt they owe including the costs and interest owed.
What do I do if default judgment has been made against me?
If a default judgment has been made against you, you should take immediate action. Once judgment has been made against you, interest will continue to accrue on the judgment debt until you repay it and this can greatly increase the amount you have to repay.
If you wish to challenge the claim by filing a defence, you will first need to apply to have the default judgment be set aside, which means it will be ‘reversed’ and you will have the opportunity to defend the claim. To set aside default judgment, you will need to demonstrate to the court that you had a good reason for not filing a defence within the requisite time and that you have a genuine defence to put on. If default judgment is set aside, you will have a limited time to file your defence with the court.
What are the consequences of default judgment?
As soon as default judgment has been entered, the plaintiff can begin enforcement against you, which may include seizing your property, garnishing your wages or bank account, and requiring you to provide a financial statement and records.
As such, it is important that you do not ignore legal proceedings that are commenced against you.